- Bitcoin is consolidating its recent gains in a well-defined range.
- The SEC decision on Bitwise's Bitcoin ETF served as a trigger for the sell-off.
- The four-hour chart shows a bullish outlook.
BTC/USD is trading around $8,000 consolidating the recent leg higher. Despite the rapid and somewhat erratic ascent, the king of cryptocurrencies is trading in a well-defined range.
The US Securities and Exchanges Commission (SEC) has decided to postpone its ruling on a request for another Exchange Traded Fund (ETF) for Bitcoin. It decided to postpone the decision for another five weeks amid concerns about some of the details.
Investors took advantage of the bearish news to consolidate and take profit on previous gains. However, the SEC's rejections and delays do not impact the prices of cryptos as they used to.
BTC/USD Technical Analysis
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The four-hour chart shows a clear trading range for the granddaddy of digital assets. The bottom is $7,683, which was the swing low and also the peak of the previous rise. The line is critical support after its role as a separator of ranges.
The top of the range is the yearly high of $8,350. We are now seeing a narrowing range of between $7,832 and $8,192.
A drop below $7,683 opens the door to $7,291 which is the 61.8% Fibonacci retracement of the move seen so far in May. The 50% retracement is at $6,954.
These Fibonacci lines are also useful in setting targets for the next bullish run. $9,418, is the 1382.% level and $10,127 is the 161.8% level, which still seems far.
The four-hour chart shows that the Relative Strength Index is below 70, thus not indicating overbought conditions. Momentum remains positive.
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